XML 39 R14.htm IDEA: XBRL DOCUMENT v3.22.4
Investments, Loans and Long-Term Receivables
 12 Months Ended
Dec. 31, 2022
Equity Method Investments and Joint Ventures [Abstract]  
Investments, Loans and Long-Term Receivables
Note 4—Investments, Loans and Long-Term Receivables
Components of investments and long-term receivables at December 31 were:
Millions of Dollars
20222021
Equity investments$7,493 6,701 
Long-term receivables142 98 
Long-term investments in debt securities522 248 
Other investments68 66 
$8,225 7,113 
Equity Investments
Affiliated companies in which we had a significant equity investment at December 31, 2022, included:
•APLNG—47.5 percent owned joint venture with Origin Energy (27.5 percent) and Sinopec (25 percent)—to produce CBM from the Bowen and Surat basins in Queensland, Australia, as well as process and export LNG.
•Qatar Liquefied Gas Company Limited (3) (QG3)—30 percent owned joint venture with affiliates of QatarEnergy (68.5 percent) and Mitsui & Co., Ltd. (1.5 percent)—produces and liquefies natural gas from Qatar’s North Field, as well as exports LNG.
•Qatar Liquefied Gas Company Limited (8) (QG8)—25 percent owned joint venture with QatarEnergy (75 percent)—participant in the North Field East (NFE) LNG project. See Note 3.
Summarized 100 percent earnings information for equity method investments in affiliated companies, combined, was as follows:
Millions of Dollars
202220212020
Revenues$18,356 11,824 7,931 
Income before income taxes8,234 3,946 1,843 
Net income5,507 2,557 1,426 
Summarized 100 percent balance sheet information for equity method investments in affiliated companies, combined, was as follows:
Millions of Dollars
20222021
Current assets$5,001 4,493 
Noncurrent assets37,789 36,602 
Current liabilities4,169 3,498 
Noncurrent liabilities17,244 17,465 
Our share of income taxes incurred directly by an equity method investee is reported in equity in earnings of affiliates, and as such is not included in income taxes on our consolidated financial statements.
At December 31, 2022, retained earnings included $42 million related to the undistributed earnings of affiliated companies. Dividends received from affiliates were $3,045 million, $1,279 million and $1,076 million in 2022, 2021 and 2020, respectively.
APLNG
APLNG is a joint venture focused on producing CBM from the Bowen and Surat basins in Queensland, Australia. Natural gas is sold to domestic customers and LNG is processed and exported to Asia Pacific markets. Our investment in APLNG gives us access to CBM resources in Australia and enhances our LNG position. The majority of APLNG LNG is sold under two long-term sales and purchase agreements, supplemented with sales of additional LNG cargoes targeting the Asia Pacific markets. Origin Energy, an integrated Australian energy company, is the operator of APLNG’s production and pipeline system, while we operate the LNG facility.
In 2012, APLNG executed an $8.5 billion project finance facility that became non-recourse following financial completion in 2017. The facility is currently composed of a financing agreement with the Export-Import Bank of the United States, a commercial bank facility and two United States Private Placement note facilities. APLNG principal and interest payments commenced in March 2017 and are scheduled to occur bi-annually until September 2030. At December 31, 2022, a balance of $5.2 billion was outstanding on the facilities. See Note 10.
During the fourth quarter of 2021, Origin Energy Limited agreed to the sale of 10 percent of their interest in APLNG for $1.645 billion, before customary adjustments. ConocoPhillips announced in December 2021 that we were exercising our preemption right under the APLNG Shareholders Agreement to purchase an additional 10 percent shareholding interest in APLNG, subject to government approvals. The sales price associated with this preemption right was determined to reflect a relevant observable market participant view of APLNG’s fair value which was below the carrying value of our existing investment in APLNG. Based on a review of the facts and circumstances surrounding this decline in fair value, we concluded in the fourth quarter of 2021 the impairment was other than temporary under the guidance of FASB ASC Topic 323, and the recognition of an impairment of our existing investment was necessary. Accordingly, we recorded a noncash $688 million before-tax and after-tax impairment in the fourth quarter of 2021. The impairment was included in the “Impairments” line on our consolidated income statement. See Note 7.
At December 31, 2022, the carrying value of our equity method investment in APLNG was approximately $6.2 billion. The historical cost basis of our 47.5 percent share of net assets of APLNG was $6.1 billion, resulting in a basis difference of $41 million on our books. The basis difference, which is substantially all associated with PP&E and subject to amortization, has been allocated on a relative fair value basis to individual production license areas owned by APLNG. Any future additional payments are expected to be allocated in a similar manner. As the joint venture produces natural gas from each license, we amortize the basis difference allocated to that license using the unit-of-production method. Included in net income (loss) attributable to ConocoPhillips for 2022, 2021 and 2020 was after-tax expense of $10 million, $39 million and $41 million, respectively, representing the amortization of this basis difference on currently producing licenses.
QG3
QG3 is a joint venture that owns an integrated large-scale LNG project located in Qatar. We provided project financing, which was fully repaid in the third quarter of 2022, as described below under “Loans.” At December 31, 2022, the book value of our equity method investment in QG3 was approximately $0.7 billion. We have terminal and pipeline use agreements with Golden Pass LNG Terminal and affiliated Golden Pass Pipeline near Sabine Pass, Texas, intended to provide us with terminal and pipeline capacity for the receipt, storage and regasification of LNG purchased from QG3. Currently, the LNG from QG3 is being sold to markets outside of the U.S.
QG8
During 2022, we were awarded a 25 percent interest in a new joint venture (QG8) with QatarEnergy that will participate in the NFE LNG project. QG8 has a 12.5 percent interest in the NFE project. At December 31, 2022, the book value of our equity method investment was approximately $0.3 billion. See Note 3.

Loans
As part of our normal ongoing business operations and consistent with industry practice, we enter into numerous agreements with other parties to pursue business opportunities. Included in such activity are loans to certain affiliated and non-affiliated companies.
At December 31, 2022, there were no outstanding loans to affiliated companies as the final loan payment related to QG3 project financing was received in the third quarter of 2022. QG3 secured project financing of $4.0 billion in December 2005, consisting of $1.3 billion of loans from export credit agencies (ECA), $1.5 billion from commercial banks and $1.2 billion from ConocoPhillips. The ConocoPhillips loan facilities had substantially the same terms as the ECA and commercial bank facilities. On December 15, 2011, QG3 achieved financial completion and all project loan facilities became nonrecourse to the project participants. Semi-annual repayments began in January 2011 and were completed in July 2022, for all loan arrangements.